The Economics Section - Page A2
October 31, 1996
STAGNANT ECONOMY IS
by Staff Economists, The Daily Republican Newspaper
BILL CLINTON'S SECRET PLAN!
WASHINGTON DESK - The secret is out in the open. The Commerce Department, on Wednesday, reported a sharp downturn in economic growth in the Clinton administration's third quarter of 1996.
The dramatic failure of growth fell from the 4.7 percent tauted by president Clinton two years ago a the result of his economic plan.
Economists expect that this is the beginning of a longer downturn in the nation's economy expected to last well into coming years.
In spite of president Clinton's bragging about growth in personal spending by consumers, spending slowed to a near standstill. Some companies relied upon president Clinton's growth forecasts in June and have been mislead into continuing to buy capital equipment that they now cannot expect to be able to use for years to come.
Attempting to put a happy-face on the dismal economic news, Commerce Secretary Mickey Kantor, was making misleading statements on the growth of the private economy, when he weakly said on Wednesday, that the economy was growing faster than 'in the so-called go-go '80s.' Kantor's comparisons brought laughter from reporters.
Comparison of the present 1996 third-quarter economic performance of the Clinton administration with the performance of the first-quarter of 1993 reveals that when president Clinton was inaugurated the economy was already climbing out of recession with growth at a rate of more than 4 percent. During his administration since then, president Clinton has given the American people a growth of minus 1.5 percent.
The dismal performance of the Clinton administration has followed a report Tuesday by the Labor Department that growth in wages and benefits had slowed in the third quarter.
The Employment Cost Index, the broadest and probably most accurate compensation gauge, climbed just six-tenths of 1 percent in the quarter, the lowest reading in a year.
The biggest disappointing surprise in the figures about the Clinton administration's economy was the steep reduction in consumer spending of less than half a percent annualized rate. In the first half of the year the rate was closer to 3.5 percent. The Clinton White House is down playing this as 'an odd blip.'
The Clinton administration claims in June of a recovery have proved hollow. For example, inventories that had increased sharply in the third quarter,suggest that a large part of the GDP gains claimed by Clinton, were not gains, but losses. They were attributable to goods that were being over produced and for which there was no consumer demand. Those goods have not been shipped nor have they been sold.
Consumers have been cautious. The White House has been in-cautious in urging American consumers to spend and American businesses to produce. The facts are in. American businesses spent 19 percent more than a year ago on equipment, largely computers, and built factories that are now empty and closed.
In spite of the NAFTA rhetoric coming from the Clinton White House over that past three years, the one area that saw a significant downturn in the Clinton economy is exports. Exports were up considerably less and 1 percent. This is a shocking truth that the Clinton administration, which has made the export boom a centerpiece of its deceptive economic message, has failed to generate any substantial exports.